WERSTATE CG%^ 

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Copy 1 

L<aLi\d, Morvey 



and 



Highways: 



Evils ©Li\d Remedies 



A Scientific Solution of the Capital and 
Labor Problem 







By 


A. 


H 


. LOW 


Third 


Editi o n 







(Jfe^<^^L 




Land, Money and Highways: 



EVILS AND REMEDIES 



BY 

A. H. LOW 



Attorney and Counselor at Law 

Fellow of Southern California Academy of Sciences 

and 

Author of "Common Sense on Money," "Scientific C6m= 

mercial Standards," "Protection and Immigration," 

"Poverty, Interest and Wages," Etc., Etc. 



"He that answereth a matter before he heareth it, it is folly and shame 
unto him. " 



Copyright 1905 by Alvin H. Low 

Third, Revised and Enlarged Edition 
1906 






CONTENTS. 

Frontispiece 

Title Page 

Preface page 5 

Preface Second Edition page 6 

Part I. — Land page 7 

Part II. — Money page 9 

Part III. — Highways page 11 

Part IV. — Summary page I2 

Part V. — Authorities page 15 

Part VI. — Conclusion* page 18 

Hope On, Hope Ever — A Poem by Gerald Massey. . . . page 23 

APPENDIX 1. 

A Proposed Act of Congress page 24 

APPENDIX 2. 

Questions. Criticisms and Answers page 28 



By Trauafo*- 



PREFACE. 

It is my overwhelming conviction that the application of the 
remedies herein suggested to the evils pointed out will bring 
about a just relation between Capital and Labor, and insure 
a fair division of the wealth thereafter created by their com- 
bined employment, and establish justice in many departments 
of our economic system. 

The subjects treated are of such vast importance as to war- 
rant a much more voluminous work. But such a book I think 
could not so well serve my purpose — which is to reach the 
great mass of voters who have no time in which to read large 
books, as well as those of more leisure. 

I have therefore expressed my thoughts in as few words as 
possible — recalling in justification the old sayings, "Brevity is 
the soul of wit," and "Enough is as good as a feast." 

Extracts from this pamphlet, accompanied with proper ac- 
knowledgments, will not be treated as infringements of the 
copyright." A. H. L. 



PREFACE TO SECOND EDITION. 

The cordial reception and rapid sale of the first edition has 
convinced me that I have not mistaken the temper of the times. 
To give this edition the highest utility while keeping its volume 
within the lowest practicable limits, I have eliminated the copy 
of the petition to Congress, sent by me through the General 
Assembly of the Knights of Labor in 1885, praying for a just 
money system ; also the speech of Leland Stanford in the Sen- 
ate of the United States May 23, 1890, in support of "A Bill to 
provide for making loans by the Government and securing the 
same by liens upon land," which bill was substantially in re- 
sponse to the prayer of said petition, and provided for Gov- 
ernment loans to the people at a rate of interest of 2 per cent, 
per annum. I cannot refrain from making the following quo- 
tation from that most able and patriotic speech : "The masses 
are beginning to realize that the condition of life for humanity 
i:-. not what is possible. To reach the possibility is the great 
question now to be considered. In the unrest of the masses 
I augur great good. It is by their realizing that their condi- 
tion of life is not what it ought to be that vast improvements 
may be accomplished. It is the duty of statesmen to furnish 
means, if possible, to find out the way by which the Creator's 
design for the highest advance of civilization is to be obtained. 
Want, discomfort and misery are not necessarily the heritage 
of the industrious and provident man." 

But for Mr. Stanford's untimely death, I believe the work 
so nobly begun would not have languished these fifteen years, 
in which the necessity for such a law has been augmented a 
hundred fold, and I exhort my liberty-loving countrymen to 
see to it that no such period be allowed to elapse before we 
shall experience the fruition of his noble effort. 

As a help to this end, I have given the space occupied in the 
first edition by said petition and speech to a bill which I have 
drafted for submission to Congress, and such criticisms and 
questions ?s have been elicited by the first edition before and 
since publication, together with my answers to the same, as I 
think will add clearness and usefulness to the work. 

If in the opinion of any, I have fallen into important error, 
and am attempting to teach doctrines not founded upon scien- 
tific principles, I invoke his kind consideration in calling my 
attention to such error. 

A. H. LOW. 
Los Angeles, Cal., 1906. 



LAND, MONEY AND HIGHWAYS: EVILS AND 
REMEDIES. 

Part I. — Land. 

Private monopoly of public necessities is the chief evil of 
civilization. To it may justly be charged most of the ills that 
beset a commercial nation. Chief among the subjects of pri- 
vate monopoly are land, money and highways ; and, first of all, 
land. Land, air and sunlight are absolute essentials to life. 
Land is limited in supply, hence may be monopolized. 

It is a fundamental truth that all persons are endowed by the 
"Creator with certain inalienable rights," among which "are 
Life, Liberty and the pursuit of Happiness." If, therefore, 
there is any one of us who has not sufficient of any of the first 
essentials to these ends, there must be others who have more 
than sufficient. The monopoly of land by one portion of the 
human family is a most serious menace to the God-given right 
of life and liberty. 

We Americans have been taught to believe that a person's 
right to acquire title to land is as unlimited as to that of per- 
sonal property, and that if he could command wealth enough 
he might acquire title to the land of the whole state, or the 
whole United States, and control it with as arbitrary and 
despotic power as he can his horse and carriage. Now, either 
this law and doctrine is erroneous, or the Creator has made a 
grave blunder in attempting to endow us with any inalienable 
rights. We must either abandon the American idea of human 
God-given rights, or the theory of land-ownership brought 
from the mother country. If a new born babe is entitled to 
any part of the earth's surface as a natural heritage, he is en- 
titled to the best that is not already in use by others. Is not 
this assertion in accordance with the fundamental principle of 
Justice? Now if we find human laws which lead to the de- 
privation of any one of a natural right, what shall we do? Let 
us adopt the language of Sir William Blackstone, and say, "the 
law of nature is superior in obligation to any other. No human 
laws are of any validity if contrary to it, and they derive all 
their force and authority from it." 

There is no more forcible proof of the violation of any natural 
law than those resulting from our laws in relation to land. We 



need not go out of our own country to see the evil effects of a 
land system that permits one generation to forestall its suc- 
cessors in the enjoyment of the land. This is one of the means 
by which colossal fortunes are secured to a few and abject want 
and wretchedness to the many. 

Laws for the regulation of society, among which are laws 
regulating the title to or occupancy of land, highways, money 
and everything requiring artificial regulation, are human, and 
there is no reason why the law-making power — which in this 
country is primarily in the people — should hesitate to correct 
any law which, from experience, has proven to be defective, 
and the one test of the law should be : is it just? 

But it is easier to find fault with a law or anything else than 
to offer an improved substitute for it. The great evil of our 
present land system is the facility it affords to those who can 
command money, to acquire title to more land than they can 
use, to the exclusion of those who would otherwise use it, and 
as land enhances in value by the increased demand caused by 
the increase of population, the land owners reap the benefit 
of labor which they have not performed, by the increased price 
they are enabled to receive for their lands. The evil results 
to those whose labor is confiscated, as it were, by those who 
have no just right to it. 

Fortunately, the subject of land taxation is within the juris- 
distion of the state. We do not have to wait for national 
legislation for that. We should tax all land not in actual use 
to the full extent of its speculative value, i. e., tax the specula- 
tive element out of land values. The object of every trans- 
action is gain. No one would buy or own land unless there 
was a hope of gain to result from the purchase or holding; and 
if every land owner was compelled to pay to the state all that 
his land increased in value from year to year, outside of that 
added to it by his own labor or expenditure upon it, there 
could be no motive for owning land not in actual use. Is not 
this a plain, simple, just and efficient remedy for the evils of 
our land system? It would not be confiscation. It would 
simply stop further confiscation. The state, which is the 
people as a mass, would simply claim and take all of the value 
of land that the people in mass have given to it without com- 
pensation, or any service on the part of he who owns the land. 
Society — the state — has a right to the unearned increment 
due to its existence and activities. 

The ballot is the only instrument we need to use in this 
struggle for Justice. Shall we use it? We shall see. 

(See Appendix 2.) 



Part II. — Money. 

The laws relating to Money are also man-made and are 
equally defective with those relating to Land. To abolish all 
forms of money would in effect reduce all exchange to barter. 

Money was invented in answer to a necessity. Facility for 
making exchange was needed, and, as all exchanges of labor 
and commodities were made according to the relative value 
of the things exchanged, a measure of value was as necessary 
as measures of size and weight. Standards of all measures 
have been securely fixed except that of value. The material 
and mass of the money unit has been fixed: the gold dollar. 
But the value, the most essential part of this measure, is varia- 
ble, everywhere and all the time. The value of money, like 
that of labor and commodities, is governed by the law of supply 
and demand. The value of money can be regulated only 
through the supply for use. While the supply of money was 
confined to a certain commodity, as gold or silver it was an 
easy subject of private monopoly, and has always been a most 
potent instrument of extortion. The history of money shows 
what fantastic and always abortive efforts have been made to 
fix and regulate the value of money, through usury laws; which 
have failed of their purpose for the sole reason that there has 
never been an adequate supply of money to meet the demands 
of commrce at the rate of interest prescribed; and until the 
invention of coined credit — paper money — to meet the demand 
not met by the supply of commodity money, such a supply 
was practically impossible. Credit money is quite a modern 
invention, to answer a necessity as imperative as the demands 
for money in its original form. The invention of credit or 
paper money has made it possible for our government to fur- 
nish a supply (by loans on good security) to meet all demands 
for money at a just and low rate of interest, and by that means 
fix the value of money and maintain that value at all times 
and places throughout the country. Instead of doing this, 
however, it has created and is now fostering a private monopoly 
— the National banking associations — with full power to supply 
much or little credit money ; not to meet the demands of com- 
merce, but to meet their demands on commerce, and their 
standard is "all the trade will bear." 

To one who has made a study of this subject it seems incred- 
ible that this thing can be suffered in this country much longer. 
My limit of space does not permit me to even touch upon the 
wrong and injustice our present money system entails. Money 
is the measure of value and should be as fixed and certain in 



its own value as the yard stick is in its length. The interest 
it will draw when loaned on good security shows what the 
value of money is, and the current rate of interest on money so 
loaned is the standard of rents and profits. A just rate of in- 
terest maintained by a sufficient and certain supply of money 
would reduce rents and profits to the same level. That in- 
terest — which is profit to capital — is unjustly high is evidenced 
by the rapid accumulation of all wealth into the hands of the 
few, to the impoverishment of the many. 

It is by the authority of the Government that all paper money 
is issued. The National banking associations use their monop- 
oly of the issue of paper money for their private personal gain. 
in the same sense that does a man his business, who runs a 
hotel or store. 

The loanable function of money is only incident. The pri- 
mary purpose and functions of money are, a measure of value 
and a medium of exchange. The incident function should be 
subservient to the primamy; but almost from the time money 
was invented its susceptibility to private monopoly through 
supply, has rendered the function of loanability at interesc 
dominant, and through it the money-issuing and money-lending 
powers have always held both the economic and political des- 
tiny of the world in their hands. 

It is the lawful right and plain duty of the Government to 
fix interest at a low rate and insist on the National banks lend- 
ing money on good security at all times on demand at that 
rate, or take the issue of credit money out of their hands and 
exercise that sovereign function itself. While the profits of 
agriculture do not average two per cent, per annum on the 
capital invested, it is clear to me that interest should, at most, 
not exceed that rate. How much lower than that it should 
be to give capital its just share of the profits of the industries 
in which it is engaged is open to discussion, but I believe this 
matter of the normal rate of interest, ii. e., the current rate at 
which money is loaned on sound security, is the vital question 
between Capital and Labor. The bone of contention between 
them is the division of the profits of their combined employ- 
ment in the industries. Fixing the price of Labor by law 
has been tried and from the very nature of things has failed. 

Fixing the value (use) of capital has only been attempted 
through usury laws, which have also failed of their purpose 
because no provision was ever made at the time of their en- 
actment or otherwise for a supply of money— the representa- 
tive of all commercial values — to meet the demands of com- 
merce at the rate prescribed. This can now be done, as it 
could never, with the knowledge existing, have been done be- 
fore. There bing (aside from land) but the two factors of 

10 



production, is it not clear that all that is left of profits after 
one factor has received its share must go to the other? As to 
its share of profits, land is a form of capital. Its portion of 
the Capitalistic share of profits being called rent instead of 
interest, but its value is governed by the same law. Congress 
alone has the right and power to cause justice to be done in 
this matter. What shall we do? We shall see. 

(See Appendixes i and 2.) 



Part III. — Highways. 



We have next to consider Public Roads, usually called High- 
ways. The highway is a public necessity scarcely less in im- 
portance in our advanced state of society than money itself. 
Certainly no great advancement in commerce could have been 
made without this means of transportation. When the land 
of a country is held in common by all its inhabitants and com- 
merce is in its simplest form, little or no attention is given to 
public roads ; but as soon as the land is occupied so that the 
members of society claim exclusive possession of portions of 
the land, it becomes necessary that a part of the land should 
be reserved to be held in common, over which the people may 
pass from place to place without let or hindrance. The in- 
stitution of highways, therefore, must date back about equally 
with that of money, for they are both vital necessities to com- 
merce, the first and grandest step towards civilization. About 
the year 1830 a new impetus was given to commerce. 

It was the employment of steam as a motive power in the 
transportation of persons and property, applied to the railroad 
locomotive, and was in itself one of the grandest strides for- 
ward in the march of human progress the world has ever wit- 
nessed. It was to the system of highways, what paper money 
was to the money system. Grand in its conception and benefi- 
cent in its purpose — a power given to man as a help to his 
moral and spiritual growth ; but like money and everything 
else of general necessity capable of private monopoly, it has 
passed into the hands of the few, who are using it with an eye 
single to their personal advantage. Suppose for a moment, 
ii you can, that every railroad in this country was suddenly 
blotted out of existence and the invention of the locomotive 
forgotten. Should the sun be darkened by a total eclipse for 
a year, the stagnation of business and general distress would 
be little more intense. 

Where is there a railroad in this country upon which every 

11 



citizen may travel or send his goods at a rate equal with that 
of every other citizen? Where is there a railroad which is 
not in the control of one or more private persons who manage 
it as they see fit without regard to public interest or common 
justice? 

Without laws to suit the business of constructing railroads 
there could be but slow progress, if any, in the' matter. All 
the land in the country is either owned by the Government or 
by private individuals, and land ownership carries with it 
exclusive possession. The law of eminent domain, which re : 
serves to the Government the right to take private property 
for public use, had to be invoked before the railroad could be 
built. So we have the spectacle of a necessity which is public 
while it is being built and "private property" afterwards, 
without any change of title. However, I hold that the ex- 
ercise of this sovereign prerogative, the right of eminent do- 
main, makes the railroads public highways, and the Govern- 
ment has the inalienable right to regulate and control them, 
precisely as it has the money system. In each case a sov- 
ereign prerogative has been farmed out to private corporations 
for their personal advantage, with but little consideration for 
justice or the public weal. The interests of the public in 
either case have been subserved only as it has been necessary 
to the corporations in question. As it stands today, railroad 
corporations are simply legalized highwaymen. 

Such vast utilities should no longer be left in the control of 
private monopolists. Every sovereign prerogative is inalien- 
ably in the people of this country. It can neither be lawfully 
given nor taken away, and if unlawfully given or taken away 
it may be reclaimed, recovered and again exercised by the 
people through their government. I believe the time has 
narly arrived when this will be done by the people of this 
country. The Government, however, will not do so unless 
the people demand and insist upon it. 

Shall we make these demands? We shall see. 

(See Appendix 2.) 



Part IV. — Summary. 



In our three preceding articles we have considered briefly 
the three great instruments necessary to Labor in the produc- 
tion and distribution of wealth. It is my purpose now to sum- 
marize the whole subject. 

There is practical unanimity on the part of the great suffer- 
in g majority as to the existence of great evils in our economic 



12 



system. All know, and the masses feel the effects of these 
evils and are crying loudly for their removal, but as to the 
remedy there are innumerable theories, each having its advo- 
cates, and those who are profiting by the injustice of the pres- 
ent system, profit further and are most secure by reason of 
the division in the ranks of the would-be reformers. They 
have learned the truth of the legend, "In union is strength," 
and are acting accordingly, as witness their combinations into 
partnerships, corporations, syndicates and trusts ; while the 
trades and labor unions are the only substantial and forceful 
combinations among the oppressed. Combinations of laborers 
as such, however, can act only on the supply of labor, and 
while the labor market is glutted with unorganized and un- 
employed laborers literally begging for work to do and every 
demand for labor filled, nothing but the greater skill and 
education of the organized laborers can have any potent and 
lasting effect upon wages. 

Political action, which is free to those belonging to the unions 
as well as those who are outside of them, is the only field in 
which all must work to accomplish a substantial and satisfac- 
tory improvement in our economic system, and because I be- 
lieve this, I have attempted to point out the paramount evils 
and a method for their eradication. 

Land, money and highways are comparable in our economic 
system to the three great mechanical powers in machinery: 
money corresponding in importance to the lever. There are, 
to be sure, other subjects for legislative correction. Every 
great public utility should be under Government control, to 
at least prevent its doing an injury to the community, but 
when we have taxed speculation out of land values, established 
a just rate of interest on money loaned and payments deferred, 
and applied government regulation to the operation and tolls 
of railroads of this country, there will be such a new impetus 
to commerce that with the exclusion of undesirable immigrants 
from other countries, every one who is able and wants to work 
will be employed, and at wages that will give him all the wealth 
he creates. My suggestions of methods of bringing about this 
happy state of things have necessarily been accompanied with 
but few illustrations of how they would operate. I hope now 
to supply this lack by describing at least some of the effects 
of the remedies advocated, and later to point to the authority 
now existing, for the laws necessary to be enacted to accom- 
plish the end sought — the establishment of Justice in our 
economic system. If the State takes in taxes all the value 
that land not in use acquires by reason of the operations of 
that part of the community not its owners, there can be no 
inducement to monopolize land, or hold it for speculative 

13 



purposes, because no profit could arise from" such holding. 
This would put agricultural and otherwise valuable land in 
the market at their true value for use and within the reach 
of the people of small means. What need is there to explain 
<>r describe the results of equal and just rates on the railroads? 
It may not be so obvious, however, how lowering the rate of 
interst on money loaned, would benefit the wage-iaborer who 
never borrows money, and has no security to pledge for the 
use of it even if he wanted to borrow. This is a fair and 
pertinent question and its proper answer is the crucial test 
of the theory of fixed and low interest. 

Interest, rent and profit of capital are kindred if not iden- 
tical. They are each compensation for the use of things ac- 
cording to their value. We, however, use the word interest 
to more specifically designate compensation for the use of 
money loaned or payments deferred. It requires no illustra- 
tion to show that since profit is only the surplus wealth pro- 
duced by the combined employment of capital and labor on 
land or that which has been derived therefrom, any division 
which fixes the share of one of these two factors, necessarily 
determines the share of the other. If the share of capital is 
fixed, only the share of labor will be variable, whereas, under 
our present system of a variable standard of value, the share 
of each is variable, and the division is based on might without 
regard to right. As a wage-earner, I am asked: "If your 
employer could borrow money at two per cent., would he pay 
any more wages than he does now?" To this I answer, it 
would at least be possible for him to do so ; whereas, with in- 
terest at 6 or 10 per cent, as now, it may be, and generally is, 
impossible for him to do so; and if all other employers were 
able to do the same there would be such a stimulus to business 
that more laborers would be in demand by employers and 
the glut in the labor market would be accordingly relieved, 
and under the law of supply and demand, all labor would 
command higher wages, mine with the rest. Fixing the rate 
of interest, so that money has the same value at all times, would 
add security to all legitimate business, which alone would be 
most beneficent, for then financial crises and money panics 
would be impossible. As it is now, one who enters upon a 
business 'with money even as low as 5 per cent., must hedge in 
his profits against the day when his interest on capital bor- 
rowed will be raised to a ruinous rate, as witness the fluctua- 
tions in New York, where at one time interest on call loans 
is as low as 2 per cent, and at another time as highe as 100 per 
cent., while fluctuations between those extremes are constantly 
occurring throughout the countrv. 

Again I am asked by a wage-earner himself: "How can 

14 



lowering the rate of interest benefit me who never borrow 
money and have no security to pledge for the loan if I wanted 
to?" To this I answer: About four-fifths of the business of 
this country is done on borrowed capital. Those who initiate 
and conduct the business have to make it so profitable that 
out of the proceeds they can pay the money lenders (usually 
the banks) the interest they have contracted for before any- 
thing can fall to them for even their services. It has been 
estimated that 95 per cent, of business enterprises result in 
failure. The test of success of any business is, does it pay 
a profit? No business will be continued long when the re- 
ceipts over expenses do not exceed the interest at the current 
rate on the money invested. It follows, as of course, that 
when business stops by reason of high interest, laborers are 
thrown out of work and wages cease, and the wage-earner who 
lives from hand to mouth is the first and most pitiful sufferer, 
and would therefore be most benefited by low interest. With 
a low and fixed rate of interest, therefore, business would be 
immensely stimulated, consequently increasing the demand for 
labor, and the supply remaining the same, just in proportion 
increasing its price or wage, and by a proper limitation on the 
coming of laborers from foreign countries, the supply would 
soon no more than equal the demand for labor, and the Ameri- 
can laborer and wage-earner would once again stand firmly 
and erect upon his feet, able to command and sure to receive 
his full share of the wealth he helps to create. 



Part V. — Authorities. 



Let us now see what authority and power we have and can 
lawfully exercise over the forces of evil in our economic sys- 
tem, and especially in the three branches of it which we have 
been considering, and suggest, if we can, suitable remedies and 
how to apply them. 

The power of taxation, which is simply the power to take 
and appropriate private property for public use without com- 
pensation to the owner, other than that which he receives 
incidentally through the public weal, is the highest prerogative 
of sovereignty. That power is now exercised by our National, 
State and Municipal governments without question as to fun- 
damental right. All controversies over taxes arise from dis- 
crimination in subjects or rates, but not upon prerogative. 
Land is as common a subject of taxation as personal property. 

15 



1 submit, without further argument, the question, is it not 
just that the Government should take by taxation for public 
use all of the increase of land values derived from the labor 
of the community surrounding it, and in no other way con- 
tributed to it by the persons who hold the title to the land? 
The power to levy such a tax resides in the people, and the 
State government is the instrument through which it can and 
should be exercised. 

The Constitution of the United States provides that "The 
Congress shall have power to coin money, regulate the value 
thereof and of foreign coin and fix the standard of weights and 
measures." Also "To regulate commerce with foreign nations, 
and among the several states." Also "To provide for the 
common defense and general welfare of the United States ;" 
Also that the Constitution and the laws made in pursuance 
thereof shall "be the supreme law of the land. 

What greater powers than these do we need, in order to' 
lower and fix the rate of interest on money loaned and to pro- 
vide an ample supply of money to make that the normal and 
current rate? The same power that enables Congress to coin 
money empowers it to regulate its value, and it is self-evident 
that the power to regulate carries with it the power to fix that 
value. And it is as scientifically and as practically necessary 
to fix the value of the standard of value as to fix the length 
of the standard of length. 

Prescribing a rate of interest without providing a supply of 
money to equal the demand at that rate has always been, and 
from the very nature of things must always be, abortive. The 
value of money, like that of everything else of commerce, is 
its use, and since interest is the price paid for the use of money, 
it also indicates what the value is, and money being the meas- 
ure of value and the medium of exchange, its value, like that 
of everything else, is expressed in money, and its use is paid 
for, unlike that of anything else, in a part of itself, or its 
equivalent in value. It is for us through Congress to prescribe 
what that part shall be and establish and maintain it. 

Lastly, it is by the exercise of that certain prerogative of 
eminent domain that we must bring, not only the railroads, but 
all other branches of industry susceptible of private monopoly, 
or of public utility, under Government control, to the end that 
they shall be not only beneficial but in no way injurious to the 
general community. 

Bouvier's Law Dictionary defines Eminent Domain to be 
"The superior right of property subsisting in a sovereignty 
by which private property may in certain cases be taken or 
its use controlled for the public benefit, without regard to the 

16 



wishes of the owner. The powers to take private property 
for public use. 6 How. 536. * * * So it was said by the 
U. S. Supreme Court : 'The power to take private property 
for public use, generally termed the right of eminent domain, 
belongs to every independent government. It is an incident 
to sovereignty and as said in Boom Co. vs. Patterson, 98 U. S., 
requires no constitutional recognition. Field, J., 109 U. S. 
513, 518.' ' The same authority says as to what may be 
taken, "Every kind of property may be taken under this power. 
It is attribute of sovereignty and whatever exists in any form, 
whether tangible or intangible, may be subjected to the exer- 
cises of this power, and may be seized and appropriated to 
public uses when necessity demands it," for which authorities 
are cited. 

Further still, we have the law of Public Policy, defined by 
Bouvier as, "That principle of the law which holds that no 
subject can lawfully do that which has a tendency to be in- 
jurious to the public or against the public good," and cites 
cases in support of this definition. 

Our right of eminent domain, however, is somewhat abridged 
by the United States Constitution, as that instrument provides 
that "no person shall be deprived of life, liberty or property 
without due process of law ; nor shall private property be 
taken for public use without just compensation." 

But here is also another provision in said Constitution : 
"All persons born or naturalized in the United States, and 
subject to the jurisdiction thereof, are citizens of the United 
States, and of the state wherein they reside. No state shall 
make or enforce any law which shall abridge the privileges 
or immunities of citizens of the United States, nor shall any 
state deprive any person of life, liberty or property, without 
due process of law, nor deny to any person within its jurisdic- 
tion the equal protection of the laws." The same Constitution 
also provides that "Neither slavery nor involuntary servitude, 
except as a punishment for crime, whereof the party shall 
have been duly convicted, shall exist within the United States 
or any place subject to their jurisdiction." It also provides 
that "The right of citizens of the United States to vote shall 
not be denied or abridged by the United States or any state, 
on account of race, color or previous condition of servitude." 

In the last provision quoted there is a plain implication, and 
it is a legal inference also, that the right of citizens to vote 
may be denied or abridged for other reasons, and the fact is, 
they are so denied and abridged on account of crime, insanity, 
idiocy and (will God forgive us?) poverty and sex! 

17 



Part VI. — Conclusion. 

"Ill fares the land to hastening ills a prey; 
Where wealth accumulates and men decay." 

We have heretofore pointed to the evils resultant from un- 
restrained private ownership of the three most prominent ob- 
jects of human necessity susceptible of monopoly, and have 
shown what the sovereign and constitutional rights and powers 
of the people are, whereby we may apply adequate remedies 
to them all and equally so to all the lesser evils not chargeable 
to any of these, that vitiate our economic system. 

There remains to be considered the manner of exercising 
these rights and powers in applying the remedies. 

I now solicit a heart-to-heart talk with my fellow citizens. 
hoping thereby to make myself the better understood, and I 
can unqualifiedly say that I entered upon this discussion and 
desire to extend it "with malice toward none, with charity 
for all." 

Lest we forget, let me repeat that every voter in the United 
States is a sovereign in his own right and that collectively 
through the ballot, we have a remedy for every ill of our now 
imperfect political and economic systems. Politics and eco- 
nomics are so closely related that it seems almost superfluous 
to separate them, as primarily, politics is the science of gov- 
ernment and economics the science of national housekeeping. 
Each is dependent upon the other ; but there usually exists in 
every country as in this a division of politics known as par- 
tisan, in the strife of which patriotism is often submerged be- 
neath a sea of personal and private interests ; hence, I think 
our political institution has not kept pace with our economic 
forcse in the march of progress. Every evil in our economic 
system should be removed without the instrumentality of 
political parties as such, but men of all parties should unite 
to perform the work as a necessity to the perpetuity of the 
Republic, and the establishment of justice. There is but one 
of two ways open to us. We may instruct our Congress and 
our Legislatures to enact laws to carry the reforms we indi- 
cate into effect, and, should they disregard or refuse to obey 
our instructions, we must see to it that their places are filled 
at the next election by those who are pledged to carry out our 
wishes. 

Petitions to government do not become sovereign citizens, 
and if our wishes are expressed in that humble form we are 
liable to be -mistaken for powerless serfs, bereft of all political 
rights, as was recently illustrated in the Russian capital. Let 
us demand of our Legislatures laws taxing all land to the full 



extent of its unearned increment, and a law that will enable 
the state government to take such control of every industr> 
within the jurisdiction of the state so far as is necessary to 
prevent such industry being managed to the injury of the 
public. 

Let us demand of Congress a lav/ reducing and fixing the 
interest on money loaned and payments deferred, to a just rate, 
and that it provide, through the method now in use, or another 
to take its place, a supply of money through loans to the people, 
on good security on demand, to make that the normal rate; 
and that it enact laws enabling the executive and judicial 
branches of the Government to take control of every other 
private industry not within the jurisdiction of the state, so far 
as is necessary to prevent the same from working injury to the 
public. As I have already pointed out, the right to enact 
such laws is ample without even a constitutional amendment. 
The effect would be to nationalize all the industries so far, and 
only so far, as is necessary for the public welfare, and with this 
secured on a just and equitable basis, the strife between capital 
and labor will cease and these two essential factors in the pro- 
duction of wealth will work together harmoniously for ttiert 
mutual good. 

A word to my comrades of 1861-5 : Eternal vigilance is the 
price of Liberty in times of peace no less than in times of war. 
We thought when we had loosed the bonds of four millions of 
chattel slaves and cemented the Union with the blood of other 
millions of our fellow countrymen, our work was completed, 
and we have rested on our laurels for forty years, heedless of 
the wise admonition, "When ye think ye stand, take heed lest 
ye fall." And not only to you who wore the blue, but to you, 
comrades, who wore the gray, and to my fellow countrymen 
all, let me say : 

This is not yet a free country, nor can it truthfully be said 
that Old Glory no longer floats over a slave! We have not 
exercised our sovereignty as best becomes citizen kings, in re- 
straining the strong from undue aggressions upon the rights 
of the weak, but have left free the spirits of Avarice and 
Ambition to hold high carnival in our fields of industry, and 
today our prisons, our alms-bouses and our potter's fields, 
crowded with the helpless victims of a merciless commercial- 
ism, crv out against us! Many thousands of our fellow citi- 
zens, gaunt with hunger and clothed in rags, throng our high- 
ways and our by-ways begging for work whereby they may 
earn an honest living, but there is no work for them ; while 
a few other thousands are surfeited with wealth and comforts 
they have never earned and their granaries and storehouses 
are groaning with food and clothing enough to satisfy the 

19 



needs of all. Generally it takes a thousand paupers, beggars 
and tramps to make one millionaire, and we have a thousand 
millionaires and many multi-millionaires who have acquired 
their estates within the past forty years ! What better evi- 
dence than this could there be of our neglect of duty? There 
is always a vast army of unemployed eager to take the places of 
those who are employed should they on any pretext quit work, 
as witness the readiness with which a strike is broken, and. 
it is claimed by the supporters of our present system that this 
army of unemployed is a necessary reserve for the use of the 
'"Captains of Industry," in cases of strikes, harvest times, etc. 
This alone is an unanswerable indictment against the system. 
Instead of making and maintaining criminals and paupers by 
such methods, the state should furnish work to all its citizens, 
at honorable and living wages, while they are unable to get 
employment in the industries. Highways and other works of 
permanent and general utility are always in need of such labor 
and the economy to the State would be immense. 

The economic forces, which have been prodigiously aug- 
mented within the past half century, have been steadily at 
work without restraint, in making the rich richer and the poor, 
poorer, until today, instead of four millions of chattel slaves, 
there are in this country forty millions of wage slaves, whose 
condition in many respects is more abject and pitiful than was 
that of the subjects of chattel slavery in its most revolting 
form ! Whoever is dependent upon the will or caprice of 
another for the precious privilege of working for a living, is 
a slave, and calling him by any other name does not change 
the fact or ameliorate his condition. Every man, woman or 
child who lives by his or her own labor paid for by another 
private person or corporation at will, is measurably a slave, 
whether the salary or wage be fifty or fifty thousand dollars. 
Every one who works under the direction of another at that 
other's unrestrained will, stands in a subservient position in- 
compatible with sovereignty and in restraint of that freedom 
which is essential to life, liberty and the pursuit of happiness 
as enunciated in our immortal Declaration of Independence. 

Employment in every industry should depend on merit and 
efficiency alone. Every business requiring government control 
to make it serve the public most efficiently or to prevent it 
being injurious thereto, will need, under government control 
or restraint, precisely the same people, or such as they, to do 
the work that do it now. I cannot conceive that any employe 
now at work for a private person or corporation under no 
government restraint or control would work less willingly or 
cheerfully in the same position were the business under the 
control or restraint of Government, and I believe that were 

20 



such a change effected, the salary earner and the daily wage 
earner alike, under proper civil service rules, woujd enjoy a 
spirit of liberty and freedom from fear of displacement and 
distress such as none of us can enjoy now. 

To those in high places of power, both political and eco- 
nomic, permit me to say : There is a spirit of unrest born of 
our unjust economic system which is crying loudly for a change 
which is nothing short of complete revolution, and the volume 
of that cry is being augmented with every turn of the wheels 
of commerce, which as now adjusted forces the centralization 
of wealth into the hands of the few as payment for the use 
of Capital, and leaves the masses who by their labor have 
helped to create that wealth no share of the increase, but re- 
duces them more and more numerously to a bare subsistence, 
having no share in the benefits accrued from the inventions 
of the age, which, too, have supplanted so many of them as 
factors of production, and reduced millions of them, the noblest 
and best people that the sun ever shone on, to worse than 
beggary. This cry, while comparatively feeble now, is dailv 
increasing in volume, and is for general confiscation of all 
the property of those they describe as one class, by what they 
conceive to be the only other class, consisting as they see it 
of those who, as they are taught and believe, have been de- 
frauded of it. Not only something must be done, and done 
quickly, but everything must be done, and that soon, to prevent 
further wrongs such as have led to this cry. History has 
proven us to be a patient and long-suffering people. Count 
not too confidently upon this characteristic. You have vested 
rights? So have we all. The vested right to life and liberty 
is paramount to that of private property. There are no vested 
wrongs. All other claims must yield to those of Justice, for 
they are eternal. Popular upheavals, under the stress of op- 
pressions suffered, are as merciless as the earthquake or the 
tornado. Deal righteously. To the masses, to whom I am 
more closely allied by experience and condition, I say: Right- 
fully and Constitutionally, such confiscation is impossible. 
Fortunately it is not necessary. 

If those who toil at honest work with brain or muscle obtain 
their fair share of the wealth they help to create henceforth, 
it will not be long until they will be self-employed or become 
constituent parts of a co-operative commonwealth whose motto 
will be : From everyone according to his ability ; to everyone 
according to his need, and a fair chance and exact justice to all. 

The proper use of the tools and machinery of production 
and distribution by those who own them is all we should re- 
quire. If they will not make such use, we must. What com- 
pensation they are entitled to for the use of their tools and 

21 



machinery, whether used and controlled by them or by the 
Government, over and above the cost of keeping in repair, 
will be determined by the rate of interest fixed for the use of 
money loaned. When that is fixed, rents and profits will 
adjust themselves to it. Hence the importance of making 
that a just rate. 

Let those who hold the titles now continue to hold them. 
Private property in most cases, as we have seen, when taken 
for public use, requires compensation to the owner. We don't 
want to go in debt for all the capital in the country, and could 
not, if we would, and a robbery today will not right the wrong 
of a robbery yesterday. 

Whenever the Government is forced to take control of pri- 
vate property, either to restrain its improper use or to secure 
its proper use, it can pay for that use out of the proceeds of 
the business, and thus avoid all onerous obligations. 

But again : The accumulation of the wealth into the hands 
of the few has been done by men — our brothers — most of whom 
are as good and as honest as we. 

They did it with our consent. We could have prevented it 
long ago, but did not. Our sufferings and deprivations are 
chargeable to our own stupid neglect. Every one of us had 
like opportunities offered, and had we known how, would have 
done as they have done. They (many of them) are in lawful 
possession because we made no law prohibiting it. Let us 
now put a curb-bit into the mouth of this monster of Private 
Monopoly and harness him to the car of State and compel him 
to pull the load of our necessities along the highway of human 
progress. Hate and Fear are the arch-enemies of human hap- 
piness. They destroy whom they would defend. Let us go 
to our work of reform resolutely but lovingly, that we may 
invoke the guidance of the Spirit of all Love. When we shall 
have done our duty as sovereign citizens and placed the ma- 
chinery of production and distribution under proper and neces- 
sary control, we will be in peaceful enjoyment of all the wealth 
we create, and again the morning stars will sing together, and 
all the sons and daughters of God will go to their labors shout- 
ing for joy. 

A. H. LOW, 

Non-partisan Citizen. 

1417 Hoover St., Los Angeles, Cal. 



22 



HOPE ON, HOPE EVER. 

By Gerald Massey. 

Hope on, hope ever ! though Today be dark, 

The sweet sunburst may smile on thee Tomorrow ; 
Though thou art lonely, there's an eye will mark 

Thy loneliness, and guerdon all thy sorrow! 
Though thou must toil 'mohg cold and sordid men, 

With none' to echo back thy thought, or love thee, 
Cheer up, poor heart ! thou dost not beat in vain ; 

While God is over all, and heaven above thee, 
. Hope on, hope ever. 



T know 'tis hard to bear the sneer and taunt — 

With the heart's honest pride at midnight wrestle; 
To feel the killing canker-worm of Want, 

While rich rougles in their mocking luxury nestle ; 
For I have fed it. Yet from Earth's cold Real 

My soul looks out on coming things, and cherful 
The warm Sunshine floods all the land Ideal, 

And- still it whispers to the worn and tearful, 
Hope on, hope ever. 

Hope on, hope ever ! after darkest night 

Comes, full of loving life, the laughing Morning; 
Hope on, hope ever! Spring-tide, flushed with light, 

Aye crowns old Winter with her rich adorning. 
Hope on, hope ever! yet the time shall come. 

When man to man shall be a friend and brother; 
And this old world shall be a happy home. 

And all Earth's family love one another! 
Hope on, hope ever. 



23 



LAND, MONEY AND HIGHWAYS— EVILS AND 
REMEDIES. 

Appendix i. 

In order to more clearly define my position in relation to 
our money system, which I believe is most in need of reforma- 
tion, and which, when corrected, will lead to the correction 
of our land and railroad systems, I suggest, by way of the 
initiative, the following Bill for submission to Congress : 

AN ACT 

Fixing the Value of the Standard Measure of Value and further 
Regulating the Value of Money: 

Be it enacted by the Senate and House of Representatives of 
the United States of America in Congress assembled; 

That on and after the first day of January, next after the 
passage of this Act, the rate of interest for money loaned and 
payments deferred, on all debts and obligations contracted on 
or after that date, shall be two (2) per cent, per annum. 

Section 2. The Secretary of the Treasury shall establish 
loan offices as he may deem expedient, not less than one in each 
county or parish in the United States and Territories and in 
the District of Columbia, having a population of two thousand 
or more, as shown by the latest census. Said offices shall be 
for issuing, lending and depositing money, as banks of issue 
and deposit are now used. Whenever, in the opinion of the 
Secretary of the Treasury and the Postmaster General, it will 
be expedient, the offices of postofhce and loan office may be 
combined. 

Section 3. The business of the loan offices respectively shall 
be performed by a cashier and one or more tellers, as the busi- 
ness may require. The duties of cashier shall be to receive 
money on deposit, pay out money withdrawn on check or draft, 
lend money on good security, make settlements of loans made 
by him, and keep a proper record of his transactions, and per- 
form such other acts and duties as shall be imposed on him 
by law and the rules and regulations of the Treasury Depart- 
ment. He shall have immediate supervision of the business 
of the office. The teller shall assist in keeping the accounts 
and records of the office and perform such other duties as shall 
be prescribed by the Secretary of the Treasury. 

Cashiers and tellers shall be appointed by the Secretary of 
the Treasury for the term of four vears unless sooner removed 

24 



or suspended according to law, and shall receive such com- 
pensation as the Secretary of the Treasury shall deem just, not 
to exceed $3,000 a year, and until otherwise prescribed by law. 
The Civil Service rules and regulations, as applied to the 
Postal Service, so far as applicable, are hereby extended to 
said loan offices. 

Section 4. Every cashier and teller before entering upon 
the duties of his office shall give bond with good and approved 
security, and in such penalty as the Secretary of the Treasury 
shall deem sufficient, conditioned for the faithful discharge ot 
all duties and trusts imposed on him, either by law or the rules 
and regulations of the department. The laws relating to 
bonds of postmasters shall also apply and extend to bonds 
of cashiers and tellers, so far as the same may be applicable. 
In the settlement of the cashier's account he shall be charged 
with all depositors' balances, moneys out on loan, all funds, 
blank notes, and property entrusted to his care or keeping, and 
be credited with all moneys, blank notes, and property on hand, 
and shall, together with his sureties, be held accountable and 
liable for all deficiencies, and for all moneys loaned and unpaid 
or outstanding. 

Section 5. Any person who shall have money to his or her 
credit as a depositor at any loan office may withdraw from 
such office money to the amount of the balance to his or her 
credit, or any part thereof, on presenting by himself, his payee, 
or endorsee, a proper check, draft, or order in writing, but 
no such depositor shall be entitled to withdraw or reclaim the 
identical money so deposited, or any part thereof. The Sec- 
retary of the Treasury shall cause to be prepared and furnished 
to the cashiers blank checks, which blanks shall be sold to 
depositors by the cashiers at cost. 

Section 6. To meet the demands for money at said rate of 
interest in excess of the amounts of other money in their con- 
trol subject to loan, the cashiers shall be provided with, and 
issue in the manner hereinafter mentioned, notes of the United 
States in denominations of one, two, five, ten, twenty, fifty, one 
hundred, five hundred, and one thousand dollars, according to 
the demands of commerce. The said notes shall be printed 
and furnished by the Comptroller of the Currency under the 
direction of the Secretary of the Treasury. 

Section 7. The notes as furnished in blank to the cashiers 
shall express upon their face that they are secured by ample 
pledges in the possession of the government of the United 
States, and bear the written or engraved signatures of the 
Comptroller and Treasurer, and the imprint of the seal of the 
Treasury and the promise of the United States of America to 
pay the bearer their face value on demand, and shall bear such 

25 



devices and such other statements, and shall be in such form 
as the Secretary of the Treasury shall by regulation direct, 
and before the said notes shall become valid and in force thev 
shall be dated and countersigned by the cashier issuing them. 

Section 8. The notes provided for by this act are hereby 
declared money and shall be issued and circulated as such, 
and shall be receivable by the Government of the United States 
for everything for which money is by law receivable, and shall 
be a legal tender in payment of all debts and dues, public and 
private, contracted after the passage of this act. 

Section 9. Every cashier shall, on request to him by any 
person lawfully competent to transact such business, and on 
the presentation by such person of good and sufficient security 
for the amount of money for which a loan is asked, receive 
such security when he shall be satisfied of its sufficiency, and 
lend money to such person, and for such time as such person 
may desire, not exceeding one year without renewal, and at 
the rate of 2 per cent, interest per annum, which said interest 
shall be payable, at the end of every three months of the time, 
unless the principal shall be payable before the end of any 
such three months, in which case the principal and interest 
shall be payable at the same time. 

Section 10. The Secretary of the Treasury shall prepare 
and issue rules and regulations for the conduct of the business 
of loan offices, which rules when not in conflict with law shall 
be obligatory upon the officers of the several loan offices. 

Section 11. If any person shall, by means of any false or 
fraudulent pretense, or by the use of any spurious or worthless 
security, knowing the same to be spurious or worthless, or by 
any secret or private collusion with any officer of any loan 
office, obtain any money from any loan office, he shall be 
deemed guilty of felony, and on conviction shall pay a fine of 
double the amount so fraudulently obtained, or be imprisoned 
at hard labor not exceeding twenty years, or both such fine and 
imprisonment, and shall be disfranchised and disqualified from 
maintaining any of the rights of citizenship under the govern- 
ment of the United States. 

Section 12. Any person who shall embezzle or appropriate 
to his own use any money, blank notes, or property of the 
United States, or of any other person or persons who shall 
have entrusted the same to the custody or keeping of the 
United States, at any loan office or depository of the United 
States, and shall be convicted thereof, such person so convicted 
shall be deemed guilty of felony, and shall for each such offense 
be fined not exceeding double the amount so embezzled or ap- 
propriated, or be imprisoned not exceeding twenty years, or 
both such fine and imprisonment, at the discretion of the court. 

26 



Section 13. The Secretary of the Treasury may at his dis- 
cretion designate any of said loan offices as depositories of 
public moneys, and when so designated the cashier of any such 
office shall be the depositary, and may be required to furnish 
additional security for the safe keeping of the moneys and 
faithful performance of the trusts so confided to him. The 
moneys so deposited may be loaned by the cashier as other 
moneys in his control, or held as reserves for the redemption 
of United States notes or subject to the order of the Secretary 
of the Treasury as to the Secretary of the Treasury shall seem 
advisable. 

Section 14. Accumulating gold and silver coins of the 
United States with intent to sell the same for any other form or 
kind of currency authorized by the laws of the United States 
at a premium, is hereby prohibited. Offering for sale as afore- 
said any gold or silver coins shall be taken as prima facie evi- 
dence of such accumulation and intent. Any person who shall 
violate the provisions of this section and shall be convicted 
thereof shall be deemed guilty of felony and shall forfeit and 
pay as a fine his entire estate, goods, money and property, or 
be imprisoned at hard labor for a term not exceeding fiftv 
years, or both such fine and imprisonment, at the discretion of 
the court, and shall forever forfeit his citizenship or right to 
become a citizen. 

Section 15. Whenever it shall appear to any cashier that a 
demand for the redemption in gold of United States notes is 
made for the purpose of embarrassing the Government or of 
depreciating the value of any lawful money of the United 
States, he shall refuse such redemption. And the Secretary 
of the Treasury may, by rules regulating the government of 
loan offices, require limited notice of intention to demand re- 
demption in gold of any other kind of money. 

Section 16. Any provision, clause or condition in any con- 
tract or agreement made after the passage of this act, requiring 
the payment of any debt or obligation in gold or silver, is 
hereby prohibited, and shall be void as to such kind of money, 
and may be paid in any lawful money of the United States. 

Section 17. For the purposes of carrying this act into effect, 
the sum of fifty million dollars is hereby appropriated out of 
any moneys in the Treasury not otherwise appropriated. 

Section 18. All laws and all acts or parts of acts in conflict 
with the provisions of this act are hereby repealed. 

NOTE — The Author respectfully requests of every one who 
approves the foregoing bill, that he send it to his Representa- 
tive in Congress and urge its enactment into law. 

A. H. LOW. 
(See Appendix 2.) 

21 



LAND, MONEY AND HIGHWAYS— EVILS AND 
REMEDIES. 

Appendix 2. 

Herein I will exhibit the state of the discussion which the 
first edition has aroused, omitting the names of my correspond- 
ents and questioners, not having obtained permission to pub- 
lish them ; and will number the paragraphs for convenience in 
case of future comments or criticisms. 

1. "Do you advocate the single tax doctrine of Henry 
George?" 

No, not if I thoroughly understand Mr. George. My idea 
of taxes is, that they are for the purpose of supporting govern- 
ment, and that government being for the protection of the 
governed in the peaceful enjoyment of their persons and prop- 
erty, as well as the promotion of the general welfare, it is right 
and proper that everyone who enjoys such protection should 
contribute to the cost of government in proportion to the value 
of the property protected. Taxes in this sense are analogous 
to premium paid for insurance. 

A poll tax may or may not be necessary or expedient, since 
in this all share equally; but while I would have every citizen 
bear his share of the expenses of government, in proportion to 
the value of his personal property, I would discriminate against 
the ownership of unimproved and unused land to prevent the 
monoply of that first essential to human existence, the Earth. 

2. "How would your theory of land taxation affect the 
rancher and farmer who are making use of their land for legiti- 
mate purposes?" 

They would usually pay less taxes than they do now; as, 
while their land might bear more taxes, their improvements 
thereon would bear less. At present, he who improves his 
land is fined for his industry; while he who holds his land un- 
improved, and keeps others out of the use of it, gets off with 
little or no tax, and his land grows more valuable year by year 
by reason of the work of others on land near it and the in- 
creased demand for land resulting from increase of population ; 
this is the injustice and evil I wish to overcome. 

3. I will at once anticipate the question which will surely 
be asked : 

"In your bill (Appendix 1) why do you provide no penalty 
for charging more than the rate of interest prescribed for, the 
use of money?" 

28 



Because it is not needed, and if such penalty were prescribed 
it would injure rather than benefit the very persons whom it 
would ostensibly protect, to-wit : those who were in need of 
loans but having nothing to give as security, except their 
known integrity. No one who has good security to give for 
a loan would borrow of a private person or corporation at a 
higher rate than he would have to pay the Government, and 
to deny him the right to borrow at any rate he can obtain a 
loan for, without such security, might cause his ruin, or make 
it a necessity to save himself through the violation of the usury 
law, in which case he would be required also to pay additional 
interest as indemnity against prosecution. In fact, of such 
has been the history of all usury laws, the world over. Usury 
laws have always been abortive of any good, since they have 
always been at variance with the law of supply and demand. 
Take for instance the usury laws of our several states. Every 
state at one time or another has enacted a penal usury law, 
which is nothing more nor less than prescribing the value of 
money under a penalty, with absolutely no provision and no 
power on the part of the law-makers to furnish money to meet 
the demand at the prescribed rate. The States and Territories 
have thus assumed a function of the National Government, and 
have exercised it by sufferance, fixing an arbitrary value on 
money, each for itself, and neither they (having no right) nor 
the National Government have ever even attempted to furnish 
a supply of money in manner and quantity to so meet the de- 
mand for money as to make the legal rate normal. For further 
light upon the folly of penal usury laws, I respectfully refer 
my readers to "Defense of Usury," by Jeremy Bentham, and 
the speech of Richard H. Dana, Jr., before the House of Repre- 
sentatives of the Massachusetts Legislature, Feb. 14, 1867. 

4. "If the current normal rate of interest is lowered to 2 
per cent, per annum, values will rise in proportion, so, after all, 
how will Labor, the first factor in production, be benefited?" 

Prices, as computed in money will so rise, once for all, in 
consequence of such change of interest, but the intrinsic value 
or usefulness of things will not so change. The nominal value, 
not the real value, of labor and commodities change with a 
change in the value of the measure of value. The actual bene- 
fit to Labor will be the difference between the 2 per cent, or 
less rate we propose to establish, and the price it pays in 
interest, rents and profits now. 

5. "Why should money loaned draw any interest?"" 
Because it is useful and its value is the measure of the value 

of all other things of value which are limited in supply. The 
law of supply and demand is the fundamental law of com- 

29 



mercial value. If the use of money could be had for the ask- 
ing, no one would part with his goods for money that he could 
get for nothing. Money would therefore have no value, being 
unlimited in supply and would no longer answer either as a 
measure of value or medium of exchange, the two functions 
for which it was created ; Aristotle to the contrary notwith- 
standing. 

6. "Why do you prescribe 2 per cent, instead of 3 per cent. 
or 1 per cent, as the desirable or just rate?" 

Two per cent., as shown by late government statistics, is 
about the average rate of net profit of agriculture in the United 
States, and that is the primary and foundation industry. I can 
see no fairness in allowing capital in any other industry a 
greater rate of profit than that of agriculture. How much 
lower the rate of interest should be, I think, is such rate and 
no more, as would induce the owners of capital to part with 
(sell) the use of their capital, rather than use it by consuming 
it themselves. 

The ethics of interest seems to me to be concerned solely on 
behalf of live labor, as man can owe no duty to dead or inani- 
mate labor, and aside from land in its natural state, all capital 
is essentially dead or crystallized labor. We owe a duty to 
the owner of capital no less than to him who has no capital, 
but not because of his capital. 

7. "Why should not the government issue a certain amount 
of money per capita in order to give the people a sufficient 
amount to do business with?" 

Because the Government has no means of knowing how 
much that would be. It is the volume of business, not the 
number of people that determines the demand for money ; and, 
further, the Government has no adequate way of supplying an 
arbitrary amount per capita or otherwise; but by loans at a 
fixed rate of interest, the supply will meet the demand auto- 
matically, and when such supply is provided, it is possible, if 
not probable, that the actual amount required will be less, in- 
stead of greater, than now. It is the amount in circulation, 
not simply the amount in existence, that facilitates trade. 

8. "How can the Government's credit stand the strain of 
such an immense issue of notes as would be likely to be re- 
quired if that bill should become a law?" 

Such law and issue would not tax the credit of the Govern- 
ment a particle, because every dollar issued would be amply 
secured by the private pledge given for its loan. There is no 
analogy between such notes so issued and the present treasury 
notes and "greenbacks" now in circulation, which were issued 

30 



tor value received and consumed in war and otherwise; on the 
contrary, they would be substantially like the gold certificates 
now in circulation, absolutely good and at a par with the unit 
of value, so long as the permanency of the Republic is secure. 

9. "Do you believe in government ownership of public 
utilities?" 

That depends on the results attainable. A public utility 
is that which serves the public, and the most desirable owner- 
ship, as I see it, is that which gives the best service at the 
lowest possible cost to the public in general. The principal 
evils attending private ownership and administration of public 
utilities are extortion and unfair discrimination. Eliminate 
these two, and it will matter but little, whether the bare owner- 
ship be private or public. It will require as many people, and 
of the same efficiency to administer the utility in the one case 
as in the other. 

While the normal rates of rents and profits remain sub- 
stantially the same as they are now, which they will do as long 
as the rate of interest on money loaned, remains the same, I 
can see but little advantage to be gained by the general public 
in substituting for extortion in rates for service, extortion in 
rates of interest on the purchase price of the utilities acquired. 
As to discrimination in administration of the service, that can, 
and should be prevented in either case, and the Government 
has ample authority, as I have shown, to do that under private 
c,s well as public ownership. 

10. "Why should not the Government construct railroads 
and other public utilities and operate them at cost?" 

If in the word cost you include the current rate of interest 
on the capital invested, I can seen no objection to it, provided 
the Government has the means of paying for such construc- 
tion. However, the Government has no such means except 
by taxation, other than the moneys arising from the sale of 
public lands. 

If, on the other hand, you exclude such interest, the com- 
paratively few who would use such utility, would have an ad- 
vantage over those who did not, to the amount of the free use 
of such capital for the time being, which would be no more 
just to the rest of the tax-paying community, than would a 
loan of so much money for the time being without interest. 
That discrimination in favor of those who are now using the 
Government credit at the rate of only one-half of 1 per cent, 
per annum, is one of the injustices and evils we should abolish. 

11. "How do you know that live labor is not receiving its 
fair share of the profits of the industries?" 

31 



For example, let us take government statistics and from 
them make a few calculations. In the year 1900 capital in the 
United States was invested about as follows: 

Agriculture $20,500,000,000 

Manufacturing 9,900,000,000 

Mining 7,400,000,000 

Railroads (transportation) 8,700,000.000 

Total $46,500,000,000 

Total wealth in V. S. in 1900 $94, 300,000,000 

Total wealth in U. S. in [890 65,037,091,000 

Increase in 10 years $29,262,909,000 

Average increase per year 2,926,290,900 

Which is 4J/4 per cent, at simple interest on the total in 1890. 

If we allow this capital 2 per cent, for its use for the year 
1900, (which is considerably more than was the profit of 
agriculture), it gives $930,000,000. Deduct this from the 
amount of the increase of wealth in 1900 and we have $1,996,- 
290,900 to go to the laborers. With an estimated population 
of 80,000,000 in the year 1900, and one laborer to every five 
persons, there were 16,000,000 laborers. Divide the $1,996,- 
290,900 between these and each will receive $124, being net 
profit over and above all expenses of himself and family. 

From page 647 of the annual report of the Commissioner of 
Labor for the year 1903, it appears that of 2,567 families of 5.31 
persons, the average income in 1901 was $827.19; average ex- 
penses for all purposes, $768.54 (of which food cost $326.60) 
leaving an average saving or profit per family of $58.65. Take 
this from $124, which it ought to have been, and it leaves 
$65.35 tnat tne family should have gotten but did not. 

By the way, it would be interesting to know how many fam- 
ilies of wage-earners received $327.19 for the year 1900 or any 
other. The statistics do not show. The statistical abstract 
o.f the United States for 1903 shows on page 66, that for the 
year ending Sept. 1, 1900, the National Banks made net earn- 
ings of 10.13 per cent, on their capital and surplus! Is it not 
plain that with an average of only 4 l /> per cent, per annum 
increase of wealth of which labor is robbed of more than one- 
half of its share, and 95 per cent, of business enterprises en- 
tered upon are failures, while the money-issuing and money- 
lending power is clearing a net profit of over 10 per cent., the 
money-lender now, as he has ever done, holds our economic 
as well as our political destiny in his hands? 

32 



12. "While you place much stress upon the law of supply 
and demand, some writers on political economy, and many lay- 
men, deny its validity and force." 

In reply to this I will refer my readers to the diagram on 
next page and the explanation which follows it. 



33 



LAND, MONEY AND HIGHWAYS 

fig i. 
X 

Use. 
FIG Z. 

USE. 

FIG 6. 
5 m v.io% D 



User. 

PIG 4 
5 M- V.10% 

x — 

Use. 

FIG 5 
S m V^i% D 



U6E. 



Diagram illustrating the law of Supply 
and Demand applied to money. 

See next page. 



34 



EVILS AND REMEDIES. 

In the diagram on opposite page, V per cent, is the value of 
money or rate of interest; S. M. the supply and 1) the demand 
for money, balanced at Use. 

Operation — For the purpose of illustration only, we assume 
that in 

Fig. i, 5 per cent, is the legal, just and normal rate and Sup- 
ply and Demand are equal at that rate. It needs no figure or 
illustration to show that when Supply and Demand change 
simultaneously and in same proportion the balance will be 
maintained at the same rate, but if as in 

Fig. 2. Demand same, supply is doubled, value falls to 
2V2 per cent. 

Fig. 3. Demand same, supply lessens one-half, value rises 
to 10 per cent. 

Fig. 4. Supply same as in Fig. 1 ; demand doubled, value 
rises to 10 per cent. 

Fig. 5. Supply same as in Fig. 1 ; demand lessened one-half, 
value falls to 2 J / 2 per cent. 

The rate of interest per annum expressed by per cent, indi- 
cates the price paid for the use of money, which is also de- 
scribed as the value of money. 

The value of money being the standard measure of value 
(although as usually stated "money is the measure of value") 
other things being equal — 

Raising the rate of interest has the same effect on prices of 
Labor and commodities, as increasing their supply or dimin- 
ishing demand for them. 

Lowering the rate of interest has the same effect on prices 
of Labor and commodities as diminishing their supply or in- 
creasing demand for them. 

Thus it will be observed that a change in the ratio between 
supply and demand on money, has the opposite effect on the 
prices of all other things for which money is exchanged. 

It should be borne in mind that the rate of interest herein 
discussed is the average or normal rate, with sound security, 
throughout the country, and that change in the normal rate is 
never as abrupt from one extreme to another as illustrated in 

35 



the diagram. In actual practice the rate changes gradually 
in proportion as the ratio between supply and demand 
changes ; and too, an increase in supply has a tendency to stim- 
ulate demand at the lower rate and a contraction of supply has 
the opposite effect. 

Who can predict the vast increase of business that would 
result from a justly low and fixed rate of interest with a con- 
stant and ample supply of money to meet the demand at that 
rate? 

Compare the foregoing diagram with the law of the lever 
and note the analogy. The one is as much a natural law as 
the other and both as immutable as the law of gravitation, and 
all attempts to circumvent them have always resulted and 
must necessarily result in absolute and iemominous failure. 



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